The nation’s largest beef packing plants are being sued by industry giant Sysco Foods – accusing the companies of suppressing cattle numbers to inflate beef prices. The federal lawsuit was filed in Texas, naming Tyson Foods, JBS, Cargill, and National Beef.
The new allegations by Sysco Foods mirror previous suits filed by ranchers, grocers, and restaurants that are still pending in Minnesota federal courts. The earlier lawsuit includes a $52.5 million settlement over price-fixing. At the time, JBS said that they did not admit to price-fixing but that settlement was in the company’s best interest. Interestingly, the company alluded that they would continue to litigate any other price-fixing claims filed by other companies.
Sysco Corporation accuses the packers of price-fixing prices by limiting slaughter numbers and driving prices paid to farmers and ranchers. The companies allege that packers are responsible for inflating beef prices to boost their profits while holding 80 percent control of the United States beef market.
Since COVID-19, packing plants have struggled with filling their plants with workers, damaging production. Plants named in the suit maintain that supply and demand are responsible for the pricing of beef, not price-fixing. Cargill’s company spokesman, Daniel Sullivan, told The Washington Post, “Cargill is confident in our efforts to maintain market integrity and conduct ethical business. We believe the claims lack merit and intend to vigorously defend our position.”
Predictably, the beef lawsuits met with similar pork and chicken processing suits.
The announcement of these lawsuits comes just months after the Biden Administration declared an intent to create a more competitive and resilient meat and poultry supply chain. The administration has put forward $1 billion to “help build and expand independent meat processing plants.”